Won't the government pay?

Medicare and Supplemental Insurance*

Medicare's skilled nursing facility (SNF) benefit
does not cover most nursing home care. Medicare will pay the cost of some skilled
care in an approved nursing home or in you home but only in some situations.
The SNF benefit only covers you if a medical professional says you need daily
skilled care after you have been in the hospital for at least three days. You should not rely on Medicare to pay for your long
term needs.

Medicare does not cover homemaker services.
Medicare does not pay for home health aides to give you personal care unless
you are homebound and are also getting skilled care such as nursing or therapy.
The personal care must also relate to the treatment of an illness or injury and
you can only get a limited amount of care in any week.

Medicare supplement insurance is private insurance
that helps pay for some of the gaps in Medicare coverage, such as hospital
deductibles and excess physicians' charges above what Medicare approves.
Generally, Medicare supplement policies do not cover long term care.

Visit the "www.medicare.gov"
for more information.

Medicaid*

Medicaid pays for some home and community-based
services. To get Medicaid help, you must meet federal and state guidelines
for income and assets. Many people start paying for nursing home care out of
their own funds and "spend down" their financial resources
until they are eligible for Medicaid. Medicaid may then pay part or all of
their nursing home costs. You may have to spend down or use up most of your
assets on health care before Medicaid is able to help. Some assets and income
can be protected for a spouse who remains at home.

State laws differ about how much money and assets
you can keep and be eligible for Medicaid. Contact your state Medicaid office,
office on aging, or state department of social services to learn about the
rules in your state.

Visit the "www.hcfa.gov/medicaid/medicaid.htm"
for more information.

*Information taken from "A Shopper's Guide to
Long-Term Care Insurance," 1999 National Association of Insurance
Commissioners.

What is long term
care insurance?

Long term care insurance is designed to pay for
assistance with activities of daily living such as eating or dressing. This
type of care can become necessary after a chronic illness or cognitive
impairment such as Alzheimer's disease. Long term care is usually provided in
settings such as a person's own home, an adult day care center, an assisted
living facility or a nursing home.

The need for long term care can occur at any time
and at any age. The cost to pay for this care can be a financial drain on your
savings and estate. Assistance with this financial burden can help to relieve
the emotional stress faced by you and your loved ones. Plan today to protect
yourself, your family members and your assets.

What does a policy
cover?

A comprehensive long term care insurance program
will cover a broad range of services.

∑Home
health care

∑Personal
care

∑Homemaker
services

∑Respite
care

∑Care
in an assisted living facility

∑Nursing
home care

∑A
local residential care facility

∑Custodial
care

∑Community-based
care in an adult day care program

∑Hospice
supplemental care

Why should I buy
long term care insurance?

With long term care insurance coverage you can:

∑Lessen
the financial risk associated with aging, illness and disability.

∑Choose
to receive long term care in the home you love.

∑Protect
your family's financial future and your retirement savings.

Some interesting statistics...

∑5
people in 1,000 will be involved in a home fire at some point in life. (Society of Actuaries, 1995)

∑70
people in 1,000 will be involved in an automobile accident at some point in
life. (Society
of Actuaries, 1995)

∑600
people in 1,000 will require long term care as they age. (Health Insurance Association of
America, 1994)

Why should I buy it
now?

Avoid high
premiums. Purchase long term care insurance when you're young
because as you age many variables can raise your insurance premiums, such as:

∑Insurance rates generally increase with age.

∑Certain health conditions that occur later in life raise insurance
premiums.

Also, consider a few facts:

∑40% of people receiving long term care are under the age of 65.

∑By 2060, 24 million Americans will need long term care, and due to
inflation will be paying over $250,000 per year to receive it.*

The following is excerpted from Realizing the
Potential of Private Long Term Care Insurance, American Council of Life
Insurance, April, 1998.

Having largely invented the culture of youth during
the 1960s, many baby boomers are more concerned with sustaining their youth and
vitality than thinking about long term care. After all, who wants to project 30
years into the future? Unfortunately, the future is the present sooner than we
think.

Now is the time for baby boomers to face the risk
of needing long term care and to recognize that:

∑Federal and state programs will pay only a
limited amount for this care

∑Unplanned long term care expenditures will
seriously affect financial security

∑Long term care insurance is an essential part of
retirement planning

∑There is value in purchasing long term care
insurance at a younger age when premiums are less expensive

As life expectancy - and the risk of disability -
increases, retirement is becoming a less predictable stage of life. An
unanticipated nursing home stay can deplete hard-earned savings and threaten a
familyís financial future. At the same time, the 21st Century could see the
erosion of the social safety net for aging baby boomers.

For most Americans, private long term care
insurance is affordable, especially if purchased at an early age. And with the
insurance industry offering innovative products, it is not surprising that a
small number of baby boomers have already purchased long term care insurance.
Hopefully, more will follow.

Policy Tips

∑Understand your policy. Take time to
review the outline of coverage. Make sure you know what the policy covers and
what it does not. If you have any questions, ask the agent or call the
insurance companyís home office before you buy.

∑Donít be misled by advertising. Donít be
misled by celebrity endorsements. Most of these people are professional actors
who are paid to advertise; they are not insurance experts. Neither Medicare nor
any other federal agency endorses or sells long term care insurance policies.

∑Donít buy multiple policies. It is not
necessary to purchase several policies to get enough coverage. One good policy
is sufficient.

∑Donít be misled by marketers of long term
care insurance who say your medical history is not important. Disclosing
your medical history is very important. Make sure you fill out the application
completely and accurately. If information about the state of your health is
wrong, and the company relied on it in granting coverage, the company can
refuse to pay your claims and can even cancel your policy.

∑Never pay in cash. Use a check or money
order made payable to the insurance company.

∑If you don't receive your policy within 60
days, contact the company or agent. When you receive your policy, keep it
in a convenient place, and tell a trusted friend or relative where it is.

∑Be sure you review your policy during the
free-look period. If you decide you do not want the policy after you
purchase it, you can cancel it and get your money back by notifying the company
within a certain number of days. This is called the "free-look"
period.

∑Read the policy again and make sure it
provides the coverage you want. Read the application you signed; it becomes
part of the policy. If itís not filled out correctly, notify the insurance
company immediately.

Policy Tips taken from A Shopper's Guide
to Long Term Care Insurance. Revised 1999 by NAIC
(National Association of Insurance Commissioners).

Analyze Your Needs

Before applying for long-term
care insurance for yourself or for a family member you should thoroughly
examine your or your family member's life and needs. If the individual
considering long-term care insurance has certain chronic illnesses or a certain
family health history, he/she may not qualify for coverage. The following is an
introduction to the factors that you should consider before applying for or
purchasing long-term care insurance.

Your lifestyle

∑You live alone or you have no family to care for you.

∑You're unwilling to ask your children to pay for long-term care.

∑You want freedom of choice regarding where you live and receive
care.

∑You're female (women tend to live longer and use more long-term
care than men).

∑You've had family members live into their 80's and beyond.

∑If you do require long-term care, you do not want to receive
public assistance and go on welfare.

∑It's important for you to leave your estate to your spouse or
children.

∑You have a family history of chronic health problems.

Your assets and income*

Consider buying long-term care insurance if:

∑You have significant assets and income

∑You want to protect some of your assets and income

∑You want to pay for your own care

∑You want to stay independent of the support of others

Do not consider buying long-term care insurance
if:

∑You can't afford the premiums

∑You have limited assets

∑Your only source of income is a Social Security benefit or
Supplemental Security Income (SSI)

∑You often have trouble paying for utilities, food, medicine, or other
important needs

*Information taken from "A Shopper's Guide to
Long-Term Care Insurance," 1999 National Association of Insurance
Commissioners.

Your personal health and well being*

Companies that sell long-term care insurance
"underwrite" their coverage. They look at your health and health
history before they decide to issue you a policy.

Insurance companies' underwriting practices affect
the premiums they charge you now and in the future. They ask you to answer
questions on the insurance application about your health. For example, they may
want to know if you:

∑Need or receive help in doing any of the following: bathing,
eating, dressing, going to the bathroom, transferring
from the bed to chair or maintaining continence.

Having certain conditions that are likely to mean
you'll soon need long-term care (Parkinson's disease, for example) probably
will mean you can't buy coverage from these companies. No matter how the company
underwrites the insurance, you must answer certain questions that the company
uses to decide if it will insure you.

*Information taken from "A Shopper's Guide to
Long-Term Care Insurance," 1999 National Association of Insurance
Commissioners.

We recommend calling local nursing home facilities
to see the average daily cost of nursing home care in your state and to contact
them for specific rates in your area.